1. Your No. 825  relative to your discussion with President has been read with interest.
2. While it is realised that a strict treaty in regard to security in the Pacific may be difficult, it is suggested that an informal statement of policy would need to be supplemented at least by staff conversations and the preparation of a plan. This is fundamental to a sound defence policy and a basis for defence preparations. In actual fact, it would be a regional arrangement in accordance with Article 52 of the charter. You will recall that, prior to the outbreak of the war with Japan, staff conversations with the United States were proceeding with a similar objective in view.
3. In regard to your discussions at the State Department, I agree that the use of bases by the United States forces should not be confined to Manus alone provided there is reciprocity on the part of the United States. It is not known whether the expression 'Australian Services' has been used with special significance. You will recall that in London we established a common viewpoint with the United Kingdom and New Zealand on this matter, and it is considered that American facilities should be available to British Commonwealth forces. In a British Commonwealth plan for co- operation in Defence in the Pacific, it might be essential that forces from the United Kingdom or New Zealand, and particularly United Kingdom Naval forces, should have these facilities equally available for their use.
4. As stated in London and mentioned by you, we would have to consider carefully the additional financial responsibilities involved in the policy that we are advocating.
5. I hope you will be able to advance this matter to a point that will enable some established basis to be agreed, even though it may only be a starting point leading to a course in the right direction. It is realised that progress would necessarily be slow and can only probably be carried out on the highest Governmental level. There is a tendency here in press comments to suggest that the Americans should be allowed into Manus on their own terms, lest they should withdraw from the southwest Pacific altogether. I gather from your report that the door to discussions is still quite open. As stated in my report to Parliament on the London Conference, Australia's part in the war, with its manpower and material resources, demonstrated the importance of the Commonwealth as a strategic base for the maintenance of security in the Southwest Pacific. I should not think that it is in the interests of American defence for important strategical considerations affecting its security to be ignored.